The Road to Perdition

By FRANK RICH

Published: July 20, 2002

Wagging the dog no longer cuts it. If the Bush administration wants to distract Americans from watching their 401(k)'s go down the toilet, it will have to unleash the whole kennel.

Maybe only unilateral annihilation of the entire axis of evil will do. Though the fate of John Walker Lindh was once a national obsession, its resolution couldn't knock Wall Street from the top of the evening news this week. Neither could the president's White House lawn rollout of his homeland security master plan. When John Ashcroft, in full quiver, told Congress that the country was dotted with Al Qaeda sleeper cells "waiting to strike again," he commanded less media attention than Ted Williams's corpse.

What riveted Americans instead was the spectacle of numbers tumbling as the president gave two speeches telling us help was on the way. For his first pitch, he appeared against a blue background emblazoned with the repeated legend "Corporate Responsibility." Next came a red backdrop, with "Strengthening Our Economy" as the double-vision-inducing slogan. What will be strike three — black-and-white stripes and "Dick Cheney Is Not a Crook"? Maybe this rah-rah technique helped boost the numbers back when George W. Bush was head cheerleader in prep school. But he's not at Andover anymore. Where his father's rhetoric gave us a thousand points of light, his lopped a thousand points off the Dow.

Once the market dissed him, the president waxed philosophical, if not Aristotelian, professing shock that his fellow citizens would care about something as base as money. Invoking Sept. 11, he said, "I believe people have taken a step back and asked, `What's important in life?' You know, the bottom line and this corporate America stuff, is that important? Or is serving your neighbor, loving your neighbor like you'd like to be loved yourself?"

Easy for him to say. It's hard to engage in lofty meditation about loving your neighbor if your neighbor is Kenneth Lay or Gary Winnick or Bernard Ebbers or any other insider in "corporate America stuff" who escaped with multimillions just before the corporation cratered, taking your job or pension or both with it.

Democrats celebrate the Republicans' travails as if it were Christmas in July. But the party's chief, Terry McAuliffe, was a Winnick crony who made his own killing before Global Crossing tanked, and its most visible presidential candidate, Joseph Lieberman, is fighting to the political death for loosey-goosey stock-option accounting. Just as the Harken-Halliburton stories gathered fuel, such tribunes of the people as Tom Daschle, Hillary Rodham Clinton and John Kerry boarded corporate jets supplied by companies like Eli Lilly and BellSouth to rendezvous in Nantucket with their favor-seeking fat cats.

But the hypocrisies of the Democrats, however sleazy in their own right, do not cancel out the burgeoning questions about this White House. Each time Mr. Bush protests that only a few bad apples ail corporate America, that mutant orchard inches closer to the Rose Garden. If there's not a systemic problem in American business, there does seem to be one in the administration, and it cannot be cordoned off from the rest of its official behavior. Compartmentalization, Republicans of all people should know, went out of style with the Clinton administration.

In the real world, everything connects. What is most revealing about Mr. Bush's much-touted antidote to the bad apples, his "financial crimes SWAT team," is how closely it mimics Enron's Cayman Island shell subsidiaries. It exists mainly on paper, as a cutely named entity with no real assets. It calls for no new employees or funds and won't even gain new F.B.I. agents to replace those whom the bureau reassigned from white-collar crime to counterterrorism after Sept. 11.

The SWAT team's main purpose is to bolster the administration's poll numbers as the Enron off-the-books partnerships did its corporate parent's stock price. And like its prototypes, it may already be going south. No sooner did the SWAT team's chief, Deputy Attorney General Larry Thompson, hold his first photo op than The Washington Post revealed that he was an alumnus of yet another bad apple, the credit-card giant Providian. Mr. Thompson had headed the board's audit and compliance committee and escaped with $5 million before the company threw thousands of employees out of work and paid more than $400 million to settle allegations of consumer and securities fraud.

Even the war on terrorism is not immune from Enron-style governance by this administration. Last weekend Jeff Gerth and Don Van Natta reported in The Times that the Halliburton unit KBR got a unique sweetheart deal with the Army last December, despite being a reputed bill-padder and the target of a criminal investigation. Why? Call it the perfect Halliburton-Enron storm. The company grabbing the deal is the former employer of the vice president. The government agency granting the deal, the Army, reports to the former Enron executive Thomas White, who is nothing if not consistent: he doesn't protect taxpayers' dollars any more zealously than he did his former shareholders'.